Friday, 27 May 2011

Food politics: Balancing the “moral economy” with business

By Noshua Watson

Last week, we started an IDS Globalisation team seminar series on business and development called, Food for thought: business impact on food market and food policy in development. Our colleague Naomi Hossain, a Research Fellow from the IDS Participation, Power and Social Change team, gave a sociological perspective on the global food prices crisis, titled “The Moral Economy of the Street: Popular Responses to the Food and Fuel Prices of 2011.”

Are record food prices behind the “Arab Spring” revolutions? Dr Hossain reminded us of E.P. Thompson’s concept of the moral economy, defining it as ‘where poor people riot to let sellers know when they think the prices are wrong.’ She argued that the food riots that we see today are popular efforts to correct gross failures of governments and establish moral limits to market activities

Dr Hossain’s research is based on the IDS and Oxfam Social Impacts of Crisis project that researches the effects of the food, fuel and financial crises in twelve communities in Bangladesh, Indonesia, Jamaica, Kenya, Yemen and Zambia. She and her colleagues asked what regular people, non-elites, many of whom are poor or work in the informal sector, believe to be the causes of the 2011 food price hike. Despite the debate in Northern media outlets about the role of commodities speculation, most of the people surveyed attributed the food price volatility to government regulatory failures, corruption and lack of responsiveness to speculation by local businesses.

In a prepared response to Dr Hossain’s presentation, Xavier Cirera, a Research Fellow from the Globalisation team and international trade and agriculture specialist, pointed out that governments are in a bind with respect to regulating commodities prices. He believes that the focus should be on limiting volatility, rather than specifying price levels. Unfortunately for governments, regulating food prices is a trade-off between urban populations who suffer from high prices and small farmers, who make up much of the employment base in developing countries and benefit from higher food prices. When food buyers and sellers are both poor, whose moral economy reigns?